How to Get Action on Audit Recommendations GAO/OP-9.2

United States General Accounting Office

GAO

July 1991 How to Get Action on
Audit Recommendations

GAO/OP-9.2.1



Preface

Through their recommendations, government audit
organizations regularly disclose a wide variety of
ways to improve government programs and
operations. For example, audit recommendations may
show the cognizant agency how government services
can be more responsive to citizen needs—at less cost
to taxpayers.

The benefit from audit work is not in the
recommendations made, but in their effective
implementation. Important measures of an audit
organization’s effectiveness are the type of issues it
tackles and the changes/improvements it is able to
effect. In addition, one of an auditor’s basic objectives
is to have his or her work make a difference.

When a recommendation is made to an agency, its
management is basically responsible for
implementing it. But auditors can do a great deal to
improve the likelihood that a recommendation will be
appropriately implemented. The purpose of this guide
is to help auditors get more action and better results
from their audit work through the following means:

• Quality recommendations: Whether audit results are
achieved depends on the quality of the
recommendation. A recommendation that is not
convincing won’t be implemented. A recommendation
that does not correct the basic cause of a deficiency
may not achieve the intended result.

• Commitment: When the auditor is committed to the
need for action on a recommendation, he/she will do
what needs to be done to get it implemented. Without
that commitment, a recommendation may not achieve
the desired action.

• Aggressive monitoring and followup: Acceptance of a
recommendation does not ensure results; effective
implementation does. Continued attention is required
until results are achieved.

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Preface

• Special attention to key recommendations: While all
recommendations require followup, some deal with
particularly serious or flagrant matters. They should
receive special attention.
For further assistance, please call (202) 275-6172.

Werner Grosshans
Assistant Comptroller General

for Policy

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Contents

Preface 1

Chapter 1 The Objective: Beneficial Results 6
Overview of Professional and Legal Requirements 6
Requirements for Aggressive Followup Needed 6
Getting the Basic Principles to Ensure the Benefits of 7
Benefits of Audit 8
Work Audit Work
10
Chapter 2 Quality Recommendations: Key to Action 10
Action-Oriented, Action-Oriented Recommendations 10
Effective Effective Recommendations 12
14
Recommendations Matters for Consideration by Legislative
15
Bodies 15

Chapter 3 Commitment—Making Improvements 15
Commitment to Happen 16
Results
Staff Commitment 19
Organizational Commitment 19

Chapter 4 Ensuring Improvements: Aggressive 19
Monitoring and Monitoring and Followup
Followup 19
Systems Basic Elements of Monitoring and Followup
Systems 20
22
Firm Basis for Monitoring and Followup
Actions 23
24
Active Status Monitoring 25
Determining the Adequacy of Actions Taken

on Recommendations
Closing Recommendations
Accomplishment Reporting
Recognizing the Basic Responsibility of

Auditees

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Contents

Chapter 5 Giving Maximum Attention to Key 26
Special Attention Recommendations 26
to Key 26
Identifying Key Recommendations 27
28
Recommendations Early and Continuing Emphasis
32
Examples of Ways to Highlight Key 36
53
Recommendations 61

Appendixes Appendix I: A Checklist for 74
Recommendation Monitoring and Followup

Appendix II: Case Study: GAO’S Monitoring
and Followup System

Appendix III: Case Study: the HUD Inspector
General Monitoring and Followup System

Appendix IV: Case Study: the Legislative
Auditor, State of Nevada, Monitoring and
Followup System

Appendix V: Laws and Regulations Requiring
Federal Agencies to Followup and Report
the Status of Audit Recommendations

Abbreviations

CFTC Commodity Futures Trading Commission
GAO General Accounting Office
HUD Department of Housing and Urban

OMB Development
RTC Office of Management and Budget
SEC Resolution Trust Corporation
Securities and Exchange Commission

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Chapter 1

Overview of Requirements for Getting
the Benefits of Audit Work

The Objective: Reducing cost and improving the effectiveness of
Beneficial Results government are major goals of each audit
organization. To achieve those goals, audit
organizations must make high-quality
recommendations and must work with those who will
implement them to realize intended benefits.

Agency managers are responsible for resolving and
implementing recommendations promptly and
effectively. At the same time, auditors are responsible
for following up to see that action is taken and that
intended results are realized.

The purpose of this booklet is to provide the
necessary guidance to evaluators and auditors1 to
help them meet the auditing standards and
expectations in audit resolution and followup on
recommendations.

Professional and GAO’s Government Auditing Standards (commonly
Legal referred to as the Yellow Book) include standards to
Requirements guide auditors so that others can rely on their work as
fair, objective, reliable, and useful assessments of
government performance. The Yellow Book
establishes followup as an integral part of due
professional care, as follows:

“Management of the audited entity is primarily responsible for
directing action and followup on recommendations . . . .

“Government auditors should have a process that enables them to
track the status of management’s actions on significant or material
findings and recommendations from their prior audits . . . .

“Due professional care also includes follow-up on known findings
and recommendations from previous audits that could have an

1The term “auditor” is used generically throughout this guide.

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Chapter 1
Overview of Requirements for Getting
the Benefits of Audit Work

effect on the current audit objectives to determine whether prompt
and appropriate corrective actions have been taken.”2

Agency management responsibility3 for resolving and
implementing audit recommendations stems from the
Accounting and Auditing Act of 1950, which set
requirements for effective internal control systems.
Renewed focus on the need to strengthen internal
controls was provided by the Federal Managers’
Financial Integrity Act of 1982. Standards for prompt
resolution of audit recommendations were included
in GAO’s Standards for Internal Controls in the
Federal Government. Additional requirements are
included in “Office of Management and Budget (OMB)
Circular A-50, Audit Followup;” the Inspector General
Act of 1978, as amended in 1988; and 31 U.S.C. \ 720.

Aggressive Saving tax dollars, improving programs and
Followup Needed operations, and providing better service to the public
are bottom lines of audit work. Recommendations are
the vehicles by which these objectives are sought.

But it is action on recommendations—not the
recommendations themselves—that helps the
government work better at less cost. Effective
followup is essential to get the full benefits of audit
work. In large measure, the benefits achieved from
recommendations determine audit effectiveness.

2Audit planning should also consider the status of
recommendations made by another audit organization to the extent
that they are available and affect current audit objectives. For
example, a state audit group should not ignore relevant and
material findings and recommendations of a federal audit
organization.

3The primary responsibility for improving operations, where the
need to do so was demonstrated by audit work, rests with agency
management. The auditor has key responsibilities to make
constructive recommendations and to follow up on such
recommendations to assess whether the intended results were
achieved.

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Chapter 1
Overview of Requirements for Getting
the Benefits of Audit Work

Getting action on audit recommendations has been a
persistent problem—one that, over the years, has
limited the effectiveness of audit organizations. GAO
audit reports continue to highlight significant audit
followup problems. They establish the need for better
audit oversight of agency followup systems and for
auditors to give increased attention to
recommendation implementation.

Recent management problems in government, such as
the Department of Housing and Urban Development
(HUD) scandal and the savings and loan crisis,
demonstrate anew the need for timely and effective
communication of relevant, significant, and useful
recommendations to those in a position to act on
them. It is equally important to ensure that
recommendations are appropriately considered,
effectively implemented, and yield intended results.

Basic Principles Ensuring the benefits of audit work requires

to Ensure the • action-oriented, effective recommendations;

Benefits of Audit • commitment to achieving intended results;
• careful application of sound monitoring and followup
Work systems; and

• special attention to key recommendations.

Each of these is highlighted below.

• Quality recommendations: Basic to effective audit
work are recommendations that, when adequately
implemented, accomplish a defined and worthwhile
result. They must state a clear, convincing, and
workable basis for implementation. Their utility and
continued relevance should be reevaluated as
followup actions progress. (For more information, see
ch. 2.)

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Chapter 1
Overview of Requirements for Getting
the Benefits of Audit Work

• Commitment: Auditors and audit organizations must
be committed to identifying and bringing about
needed change. The auditor’s commitment should be
personal and professional. The audit organization
should be supportive and reinforce the commitment
to its staff. (For more information, see ch. 3.)

• Monitoring and followup system: The audit
organization should have a system that provides the
structure and discipline needed to promote action on
audit recommendations. It should ensure that
recommendations are aggressively pursued until they
have been resolved and successfully implemented.
Also, auditors should assess whether the agencies
they audit have a followup system that adequately
meets their basic responsibility for resolving and
implementing audit recommendations. (For more
information, see ch. 4.)

• Special attention to key recommendations: Auditors
should ensure that key recommendations are fairly
considered when effective use of the first three
principles has not done so. They should reassess
strategies to get positive action on those
recommendations. Outside intervention should be
considered when it would help to get necessary
action on key recommendations of great significance.
(For more information, see ch. 5.)

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Chapter 2

Action-Oriented, Effective
Recommendations

Quality Recommendations state what an audit organization

Recommendations: believes should be done to accomplish beneficial
results. They do not direct what must be done but

Key to Action seek to convince others of what needs to be done.

Recommendations should be action-oriented,
convincing, well-supported, and effective. When
appropriately implemented, they should get the
desired beneficial results.

Action-Oriented To achieve the desired action, recommendations must
Recommendations have the following characteristics:

• Properly directed: Recommendations should be
directed to those who have responsibility and
authority to act on them. They must be clear about
who the action person is. For example, “We
recommend that the Director, Defense Logistics
Agency, . . . .”

At times, recommendations are directed to people
who have a number of roles. The recommendation
should state the role that applies, e.g., “The Secretary
of Commerce, as head of the lead agency guiding and
coordinating the federal metric transition, should . . .
.”

• Hard-hitting: There should be no doubt that a
recommendation has been made. Recommendations
should be clearly labeled as such, not hidden, or
obscured by text. They should be readily identifiable
and stand out in the report.

Vague language should be avoided. For example, “The
federal government should have an interest in the
quality of food in general” does little more than imply
the possibility that a recommendation has been made.

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Chapter 2
Action-Oriented, Effective
Recommendations

Soft language, such as “consideration should be given
to,” does not suggest significance or conviction that
action is required.

• Specific: Recommendations should state as
specifically as possible just what action should be
taken. This is a matter of degree. Audit
recommendations do not tell how to develop a
system, but they should be specific about the system
that needs improvement and the objectives that
should be achieved by the change. For example, “We
recommend that the Commissioner of Internal
Revenue begin collecting the kinds of management
information needed to assess the effectiveness of its
alien compliance efforts. That information should
include . . . .”

Recommendations for additional studies should be
made only in rare cases and for very good reasons.
When such a recommendation is made, it should be
worded in a way that demonstrates the need for
additional work without calling into question the
value of the audit work being reported.

• Convincing: Recommendations should be
well-supported by facts and should flow logically
from these facts. This connection can be made by
placing the recommendation close to the finding or by
inserting language in the recommendation, such as
“To help reduce the number of costly and lengthy
automatic data processing acquisition programs, the
Secretary of the Air Force should . . . .”

In addition, recognizing actions that have been
completed or are underway to correct an identified
problem adds balance to a report and makes it more
convincing.

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Action-Oriented, Effective
Recommendations

• Significant: A decision on a recommendation is
influenced by the significance of the deficiency that it
would correct. The finding and the recommendation
must clearly demonstrate that acting on the
recommendation will improve operations, safeguard
assets, or bring the situation in compliance with laws
and regulations.

• Positive in tone and content: Positive, constructive
statements are more likely to get action than negative
ones.

Effective To be effective, recommendations must identify a
Recommendations course of action that will correct an identified
problem or cause significant improvements. The
attributes of effective recommendations are discussed
below:

Deal With Recommendations should recognize and counter
Underlying Causes systemic problems. For example, audit work may
disclose that an agency’s policy is being circumvented
with demonstrated adverse effects. But if the policy
includes requirements that cannot be reasonably met,
a recommendation to comply with it will not be
effective. A better recommendation would be to
simplify the policy so that its requirements would be
less cumbersome and costly to administer while still
accomplishing its objectives.

Be Feasible Recommendations must take into account legal and
practical constraints that would make their
implementation impossible or unlikely. For example,
if contract overpricing is found, a recommendation
asserting a legal basis for recovering the overpayment
can be made only after it has been determined that
there is a contractual or other legal basis for recovery.
Legal counsel may be required for that determination.

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Action-Oriented, Effective
Recommendations

Be Cost-Effective Or if significant error or fraud in an expenditure
program is established, a recommendation to use
Consider computer-matching approaches, information from
Alternatives protected sources, or the like must fully consider
privacy rights and requirements of legislation, such as
the Computer Matching and Privacy Protection Act of
1988.

Recommendations must also consider the realistic
limitations that agencies face, such as financial
constraints. In addition, auditees may be constrained
by a range of other factors, including managerial time,
attention, and talent. An effective recommendation
must recognize and deal with all such constraints to
acting on a recommendation.

Recommendations should be made only after the
costs of acting on them have been considered.
Offsetting costs should be considered. Favorable
consideration of a recommendation is more likely if
the report makes it apparent that the
recommendation was made with knowledge of
offsetting costs.

Recommendations to comply with laws and
regulations should seek the least costly basis for
effective compliance. However, recommendations
dealing with compliance with laws and regulations
should be made even though their implementation
may cost more.

At times, more than one course of action would
correct an identified deficiency. When one is clearly
better than the others, it should be recommended.
When there is no clear basis for selecting one course
of action over the others, all should be included along
with the pros and cons of each. This approach may be

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Chapter 2
Action-Oriented, Effective
Recommendations

particularly appropriate to work involving policy
analysis.

Recommendations that would require an increase in a
program’s funding should be made only after
considering other alternatives and determining that
such a recommendation is clearly appropriate and
feasible. (Under the Budget Enforcement Act,
discretionary resources can be increased for one
program only by reducing those of another.)

Matters for At times, a significant program improvement may
Consideration by require action by the cognizant legislative bodies. The
Legislative Bodies likelihood of actionby the Congress or by state or
local legislative bodies is greatest when reports are
submitted directly to them and to their committees in
time to meet their timetable. Recommendations for a
specific course of action and information analyzing
various options are most useful when they are
available for appropriation, authorization, oversight,
and other legislative deliberations.

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Chapter 3

Commitment to Results

Commitment— A commitment to results is perhaps the most
Making important, but least tangible, requirement for
Improvements ensuring that the benefits of audit work are realized.
Happen Getting action on recommendations depends, to a
great extent, on such commitment; that is, on the
individual and organizational mind set, emphasis, and
priority given to recommendation followup.

Individual auditors should realize that their personal
commitment gets action on audit recommendations.
Audit organizations need to reinforce the importance
of such commitment and reward accordingly.

Policy statements, supervisory communications, staff
conversations, and day-to-day behavior should
emphasize the benefits from audit work. For both
individual auditors and audit organizations,
accomplishments should be a significant objective.
The key question should be were improvements
made, and did they achieve desired results?

Staff Commitment to results means that audit staff
Commitment consider action on recommendations as the
fundamental objective of their work. Characteristics
of commitment are discussed below.

• Believing in their recommendations: Auditors must be
convinced that their recommendations are of the
highest quality and, if acted on, will bring about the
desired improvements. Without this conviction, audit
staff are unlikely to devote the extra effort sometimes
needed to get recommendations implemented.

• Promoting action: This includes selecting the
communication product that is most likely to be
effective, determining how findings and
recommendations can best be presented to promote
acceptance, and considering briefings or other
face-to-face approaches where they would be helpful.

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Chapter 3
Commitment to Results

More fundamentally, it involves willingness to use
imagination and initiative to get beneficial results
during work on all assignment phases. Getting results
should be the central focus of an audit job. It should
be considered in assignment design, data
collection/analysis, and product preparation, as well
as in recommendation followup.
• Understanding the agency (or congressional
committee) environment: Preconceptions and
constraints that would inhibit acceptance of a
recommendation should be recognized. When such
difficulties are understood, getting around them may
be possible without sacrificing the goals being sought.
• Cooperating and helping: Recommendations are more
likely to be accepted when agency managers (or
committee members and staff, where applicable)
believe that auditors are constructively looking for
improvements and have demonstrated a willingness
to cooperate in making them. When a
recommendation as originally made is not accepted,
rapport and mutual respect may make it possible to
find acceptable alternative solutions.
• Believing in the need for change: Implementing
recommendations can take considerable time, as long
as 3 years for some key recommendations. During
that time, other work occupies “center stage” for
audit staff. Determination is needed to keep track of
implementation status, reassert the need for action,
and reevaluate ways to get recommendations
implemented.

Organizational Audit organizations should provide an environment
Commitment that fosters and reinforces staff commitment to
results. This can be done through systems and
behavior.

Job Management Job management systems should emphasize factors
Systems that are likely to produce good recommendations and

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Chapter 3
Commitment to Results

Management should promote action to get recommendations
Systems accepted and implemented.

For example, the systems should require reasonable
assurance, before an audit assignment is authorized,
that it will have a significant beneficial impact. In rare
cases, an audit organization may be required to do
work from which only a minimal contribution is
likely. Even then, the available contribution should be
aggressively pursued, but with an application of staff
resources commensurate with the potential benefits.

In addition, job management systems should

• ensure continued management attention as the audit
progresses to determine whether planned results are
being achieved;

• encourage prompt modification or termination of
assignments, possibly through go/no-go decisions at
significant milestones, and when fulfillment of
planned objectives is not reasonably attainable; and

• ensure that planning for results and how they will be
attained is a part of the job from beginning to end and
that such planning includes approaches to promote
acceptance and implementation of recommendations.

Management systems should track accomplishments
and should relate them to specific recommendations.
Doing so helps audit staff identify with results
achieved. Highlighting tangible benefits—dollar
savings and management improvements—throughout
the organization helps focus attention on results
rather than on reports. Relating awards and bonuses
to individual and team efforts that produced
significant benefits can help demonstrate what the
organization values most.

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Commitment to Results

Resource Allocation Resource allocation and staffing decisions should
and Staffing recognize and provide the time required for
Decisions recommendation followup. Generally, followup
should be a continuing responsibility of the staff that
did the audit work. In some cases, a followup staff
may be designated.

Regardless of how followup is done, it should be clear
that audit followup is a significant and valued
responsibility. Staff should not be made to believe
that followup time must be borrowed from other
responsibilities considered more significant.

Training Programs Training programs should have a strong results
orientation. Training should stress the professional
proficiency required for solid and significant
recommendations. It should also include motivational
and other factors that encourage staff to plan
recommendations and actions needed to get them
accepted.

Performance Performance reward systems should specifically
Reward Systems recognize and reward individual contributions that
help make the results of audit work effective.
Personnel appraisals, for example, should highlight
proactive, innovative, and creative approaches used
to get action on recommendations.

Appraisal systems and the way they operate in
practice should cause staff to believe that their
contributions to getting action on the results of audit
work are a significant factor in appraisals, awards,
promotions, and other salary decisions.

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Chapter 4

Monitoring and Followup Systems

Ensuring An important objective of audit work is the action
Improvements: that results from it. To determine if that objective was
Aggressive achieved, audit staff need to answer two questions:
Monitoring and
Followup • What improvements were made as a result of audit
work?

• Did those improvements achieve the desired result?

An effective recommendation monitoring and
followup system should make it possible to get those
answers. Appendix I is a checklist of questions to be
considered in recommendation monitoring and
followup. Appendixes II through IV include case
studies of monitoring and followup systems being
applied in audit organizations at the federal and state
levels.

Basic Elements of Monitoring and followup systems can be
Monitoring and sophisticated or rather simple. Which should be used
Followup depends on a number of factors,including the size and
Systems complexity of the audit organization. Regardless of
the type chosen, each system should include the
following basic elements:

• A firm basis for monitoring and followup actions.
• Active status monitoring.
• A determination of the results of actions taken on

recommendations.

These elements are discussed in the following
sections.

Firm Basis for To provide a basis for staff to monitor and followup
Monitoring and on actions taken on audit recommendations, the
Followup Actions followup system should be properly designed, as
outlined below.

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Chapter 4
Monitoring and Followup Systems

Active Status • It should be firmly rooted in policy. The audit
Monitoring organization’s commitment to getting action on
recommendations should be clear. Characteristics of
organizational and staff commitment are discussed in
chapter 3.

• It should define individual responsibilities. Generally,
staff responsible for the audit work are responsible
for followup. While individual staff members go on to
other assignments, there should be no doubt about
who has continuing followup responsibility and what
that responsibility is.

• It should include basic ground rules for followup,
leaving plenty of room for staff initiative. The system
should describe minimum required actions,
documentation requirements, and the like. But it
should recognize that effective followup needs to be
tailored to particular recommendations and the
results they seek. This tailoring can be promoted by a
system that requires development of a followup plan
for each assignment.

• It should ensure that all recommendations are
followed up. For example, cognizant agencies
performing audits under the Single Audit Act of 1984
are responsible for following up on recommendations
that affect more than one federal agency (i.e.,
cross-cutting issues) as well as those that involve
their own agency programs.

• It should identify what each recommendation is
expected to accomplish, including an estimate of
potential monetary benefits. This information helps
judge the adequacy of implementation actions.

Before recommendations are made, discussions with
agency managers—particularly during the exit
conference—should establish that corrective action is
needed. Also, the audit report should document a
strong case for the recommended course of action.
Yet, even when these guidelines are followed,

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Monitoring and Followup Systems

Determining implementation may drag for a variety of reasons.
Progress Therefore, the status of recommendation
implementation must be actively monitored.

Status monitoring and followup involves
(1) determining progress being made to implement
recommendations and (2) taking actions that help to
get effective implementation when progress is not
adequate.

To determine progress, the followup system should
monitor the status of action on all recommendations
until they have been implemented.

The Inspector General Act of 1978, as amended; 31
U.S.C. \ 720; and “OMB Circular A-50” include specific
requirements for agency heads to report to designated
congressional committees and to OMB on action
taken or planned for certain audit recommendations.
(See app. V for a description of reporting
requirements.) Those reports and agency followup
systems can give useful status information.

The progress that can be expected depends on the
type of recommendation. Some recommendations for
congressional action and those that seek to solve
complex problems can take years to implement.
GAO’s experience is that action on recommendations
usually occurs in the first 3 years after the
recommendation is made.

Recommendation monitoring is an ongoing
responsibility and the status of all open
recommendations should be determined on a
regularly scheduled basis. For example, GAO
determines and documents the status of all open
recommendations twice each year. This helps to

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Monitoring and Followup Systems

ensure that no recommendation will be permitted to
remain dormant.

Take Additional Another important part of followup is assessing
Steps to Get options and strategies that can help to get effective
Recommendations implementation when progress is determined to be
Implemented inadequate.

When status monitoring identifies dormant
recommendations, followup should determine why
action is not being taken. It may then be possible to
take additional steps to counter objections or
implementation difficulties. It may also be possible to
develop agreeable alternatives that will meet the
objectives to which the recommendation was
directed. Alternatively, it may become apparent that
the environment has changed such that the problem
no longer exists or the recommendation is no longer
relevant or feasible.

Determining the Were the actions that were agreed to actually taken?
Adequacy of Did the actions that were taken have the intended
Actions Taken on results? Answering those questions could include a
Recommendations variety of approaches. Few auditors would accept,
without verification, a statement by the auditee that
certain actions would be taken and that those actions
would correct the problems to which the
recommendation was directed.

But how far should audit staff go in verifying that
action was taken and in determining whether it
achieved desired results? How long should
recommendations be held open pending those
determinations? The answer depends on such factors
as the significance of the recommendation and the
time required for its implementation.

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Monitoring and Followup Systems

As a minimum, implementation plans and time frames
should be reviewed for consistency with
recommended actions. Documentation to carry out
planned actions should be examined. Auditee
estimates of dollar savings or other benefits should be
reviewed, and the reasons for significant differences
from audit estimates should be explored.

For more significant recommendations,
implementation actions should be tested. For key or
critical recommendations that have not been
implemented within a reasonable time, another audit
or strategy may be warranted. If a followon audit is
planned, it should use additional strategies to
maximize the likelihood of achieving intended results.

Closing The followup system should give guidance on when
Recommendations recommendations should be closed.1 Successful
implementation should be the primary reason. When
testing satisfies the auditor that objectives are being
achieved, the recommendation should be promptly
closed. As discussed above, some recommendations
are so significant that a followon effort may be
necessary to give the required degree of assurance
that intended objectives are being achieved. If action
is satisfactory, the recommendation should be closed.

But successful implementation is not the only reason
for closing recommendations. At times,
recommendation monitoring discloses that
circumstances have changed and the
recommendation is no longer valid.
Recommendations should be closed when they are no

1In some agencies, under federal inspector general legislation,
inspectors general are responsible for monitoring the followup
system. In others, it is the responsibility of agency management.
Inspectors general have a specific responsibility to inform the
Congress through the semiannual report of any significant
management decision with which they disagree.

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Monitoring and Followup Systems

longer valid, when additional information becomes
available that establishes that the recommendation
should not be pursued, or when it is decided that
further action does not have a reasonable likelihood
of success. When nothing more can reasonably be
done to get implementation, including actions
discussed in chapter 5 for key recommendations,
leaving recommendations on the books does not help.

Accomplishment Accomplishment reporting is an important part of an
Reporting effective followup system. It makes visible and brings
together the results of audit work as established by
recommendation monitoring and followup.
Accomplishment reporting promotes staff
commitment to results by associating
accomplishments with the work of individuals. It also
provides a useful way to gauge the audit
organization’s success.

The criteria for determining accomplishments should
require that

• the recommended action or an acceptable alternative
was actually taken and

• the recommendation’s implementation caused or
significantly influenced the benefits achieved.

Accomplishments that should be reported include
quantifiable benefits, such as those for which agency
reporting is required under the Inspector General Act
of 1978, as amended. (See app. V for more
information.)

But not all benefits are quantifiable. The
accomplishment reporting system should also
highlight financial benefits that cannot be determined
or reliably estimated and other actions that improve
government operations but yield no quantifiable

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Chapter 4
Monitoring and Followup Systems

benefit. Nonquantifiable benefits can be extremely
significant—including those that improve the quality
of life as well as those that preserve life itself.

Perhaps the most important aspect of
accomplishment reporting is that it be credible. Care
should be taken to ensure the system’s integrity.

Recognizing the The basic responsibility for taking action on audit
Basic recommendations rests with the agency to which the
Responsibility of recommendations were made.
Auditees
Auditors should assure themselves that the agency
has an effective system in place for resolving,
following up, and implementing audit
recommendations. Determining how effective agency
systems are and recommending improvements where
necessary can go a long way to ensuring that
individual audit recommendations accomplish their
objectives.

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Chapter 5

Special Attention to Key
Recommendations

Giving Maximum While all audit recommendations should be
Attention to Key aggressively pursued, some recommendations are so
significant that added steps are needed to get them

Recommendations implemented.

For example, what should be done when, despite
aggressive followup, a key recommendation has been
rejected or ignored, and there is no reason to believe
that the passage of time will improve prospects of
getting beneficial action? And what course should be
followed if the recommendation may eventually be
implemented, but the matter is too significant to let
current conditions continue? This chapter suggests
additional approaches that should be considered in
such cases. (Also, see apps. II-IV for ways in which
special attention is given to key recommendations at
the federal and state levels.)

Identifying Key The significance of a recommendation depends on the
Recommendations subject matter and the specific situation.

Frequently, significance can be assessed in terms of
dollars. For example, assume that implementation of
an audit recommendation would correct inadequate
internal controls in an area where very significant
amounts of money are subject to theft or
manipulation. The inadequate controls are readily
recognizable as a significant deficiency. A
recommendation to strengthen the internal controls
in an area of such significance and susceptibility
would be key and worthy of special emphasis.

However, dollars are only one measure of
significance, not necessarily the most important one.
For example, the need to ensure implementation of
recommendations to provide safe operation of a
nuclear plant can hardly be overemphasized.
Implementing such a recommendation could prevent

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Chapter 5
Special Attention to Key
Recommendations

Early and the loss of life, substantial bodily injury, or
Continuing environmental contamination.
Emphasis
There is a vast difference between recommendations
dealing with conditions that are imminently life
threatening and those that are just significant enough
to be reportable. Likewise, a wide range of actions
can be taken to get recommendations implemented.
But, for those relatively few, critical
recommendations, a maximum effort should be
applied.

The significance of a finding and a recommendation
should be known to the auditor and communicated to
the auditee early during an assignment. The fact that a
recommendation is considered to be a key one should
not come as a surprise to the agency being audited. It
should have been made apparent during early
discussions with agency officials and certainly at the
exit conference.

Emphasis on key recommendations should be
continued as the findings and recommendations are
reported. Key recommendations should be identified
and highlighted in reports in a context that makes
their significance apparent. Executive summaries and
transmittal memorandums can be used to further
establish and emphasize the significance of key
recommendations.

If monitoring and followup disclose that action on a
key recommendation is not progressing, additional
steps should be promptly considered. Followup
should be elevated to progressively higher levels of
agency management. Department or agency
management at the highest levels should be made
aware of the significance of the recommendation and
the need for prompt action.

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Chapter 5
Special Attention to Key
Recommendations

When the head of the audit agency gives personal
attention to getting action on a recommendation, a
high level of significance is clearly demonstrated.
When the top person invests time, effort, and personal
commitment, the subject matter is established as
special. It will be accepted as such, and the chance of
favorable action on the recommendation will be
greatly increased. But that level of attention can be
given to only the most significant matters.

Examples of Examples of legal and regulatory steps that the
Ways to Highlight General Accounting Office, the inspectors general,
Key and the state audit agencies can take to get action on
key recommendations are presented below.

Recommendations

The General Congressional interest in making sure that GAO’s
Accounting Office recommendations are carefully considered by
executive agencies is emphasized by 31 U.S.C. \ 720.
That law requires that an agency head to whom GAO
makes a recommendation submit a statement to
designated congressional committees describing
actions taken on the recommendation.

GAO’s location in the legislative branch of
government gives it access to congressional
decisionmakers. That access provides an additional
measure of influence that GAO can use to get the
necessary focus on significant matters. Some
examples follow:

• When GAO reports to the Congress or to
congressional committees having jurisdiction over a
subject matter, it helps focus congressional attention
on matters that GAO believes to be significant.

• By invitation of congressional committees, GAO
officials frequently have the opportunity to testify on
matters currently before the Congress. In their

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Chapter 5
Special Attention to Key
Recommendations

testimony, the Comptroller General and other top
GAO managers highlight key findings and
recommendations at a time when congressional
action or the use of its influence is most feasible.
• GAO fosters acceptance of key recommendations by
providing material to oversight committees and to
appropriations and authorization committees as
decisions are made on agency programs.

For example, many of GAO’s recommendations
involve significant financial savings. When GAO
provides appropriations committees with information
on recommendations that have significant budgetary
impact, the benefits of the recommendations can be
realized through the budget process. Implementation
of other GAO recommendations would correct
problems that are significantly impeding the success
of programs. Providing authorization and oversight
committees with timely information on those
recommendations can help to reinforce the need for
corrective action.

• Each year, GAO provides a report to the House and
Senate Appropriations Committees, and to other
interested committees, on the status of all open GAO
recommendations. The report includes summaries
identifying key open recommendations that, in GAO’s
judgment, need priority attention.

Inspectors General The Inspector General Act of 1978, as amended,
requires inspectors general to highlight significant
findings and recommendations to the Congress. That
act includes the following reporting requirements:

• Inspectors general are required to submit semiannual
reports to heads of agencies, who transmit the reports
to the Congress. In those reports, the inspectors
general are to include problems, abuses, and

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Chapter 5
Special Attention to Key
Recommendations

State Audit deficiencies that they believe are significant. The
Organizations reports should also include recommendations for
corrective action and significant recommendations
included in prior reports for which action has not
been completed.
• Inspectors general are required to immediately report
particularly serious or flagrant problems, abuses, or
deficiencies to the head of the agency involved. The
agency head is then required to send the report,
together with statistical tables showing actions taken
on the inspector general’s recommendations, to the
appropriate committees or subcommittees of the
Congress within 7 calendar days. Any additional
comments the agency head considers appropriate
may be included.

The 7-day report can focus congressional attention on
key matters for which action is considered essential.
This reporting device should be used judiciously to
ensure that matters reported will continue to receive
extraordinary attention.

Audit organizations at the state level have a range of
approaches for ensuring action on recommendations.

For example, the Nevada legislature oversees action
taken on recommendations made by the Legislative
Auditor. The Nevada Revised Statutes include specific
requirements for state agencies to plan action on
audit recommendations and to report the status of
implementation. In extreme cases, the statutes
provide that money may be withheld from an agency
to enforce compliance with implementation planning
requirements.

When the Legislative Auditor is concerned about the
status of action on recommendations, he/she informs
the Legislative Commission of the state legislature.

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Chapter 5
Special Attention to Key
Recommendations

Agency officials are questioned about those concerns
at the next commission meeting.

When the legislature is in session, the Legislative
Auditor’s concerns about the implementation of
critical recommendations are brought to the attention
of the Assembly Ways and Means and Senate Finance
Committees. State agencies often must explain to
those committees why the recommendations have not
been implemented.

These statutory requirements provide the Nevada
Legislative Auditor with a ready means to highlight
recommendations for legislative action.

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Appendix I

A Checklist for Recommendation
Monitoring and Followup

Planning for This appendix includes some questions that auditors
Followup should consider as they monitor and followup audit
recommendations. The questions are grouped into the
following stages:

• When monitoring and followup actions are being
planned.

• As the auditee is considering the recommendations
and planning and implementing those it accepts.

• When recommendations are rejected, inadequately
implemented, or inordinately deferred.

The first step is planning how best to get the
recommendation accepted and implemented in a way
that accomplishes its objectives. The following
questions can help guide development of a monitoring
and followup plan:

• Has what you expect to happen in implementing the
recommendation been spelled out? Do you have a
firm basis for judging the adequacy of the agency’s
implementation plan?

• Have you identified and evaluated alternatives? Is
there a viable and effective fallback position?

• Do you know the benefits that can be expected from
implementation? Have you identified and considered
offsetting costs?

• Have you identified expected benefits by the
categories included in the Inspector General Act of
1978, as amended? If that legislation does not apply,
are there similar legal or regulatory requirements that
should be considered?

• When can you expect a substantive decision on the
recommendation?

• When can implementation reasonably be expected to
begin?

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Appendix I
A Checklist for Recommendation
Monitoring and Followup

• When can completion of implementation be
expected? Are there implementation milestones that
should be completed in a particular time frame?

• Is there a time-critical point by which the
recommendation should be fully implemented?

• When can you expect benefits to be realized?
• What must happen before you can cease followup

action because a recommendation has been
effectively implemented?
• Have agency reactions during work on the
assignment, at the exit conference, or on the draft
report suggested objections or roadblocks to
implementation? Have such objections been
effectively countered in the report? Are there actions
that can be taken during followup or monitoring to
counter the obstacles?
• What will you do to test implementation? When will
you do the testing?
• What will you do to monitor action on the
recommendation? When and how frequently will
particular monitoring actions be performed?
• Have you developed a followup plan that includes
matters such as the above and that defines followup
responsibilities?

Applying the Plan The following questions should be considered during

monitoring and followup:

• Have you reviewed agency reports required by law or
regulation, such as “OMB Circular A-50?”

• Is the recommendation being aggressively followed
up by the agency through its followup system?

• Do you know the current status of acceptance and/or
implementation of the recommendation? Is it
adequate?

• Have you reviewed the agency’s written
implementation plan? (A written implementation plan

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Appendix I
A Checklist for Recommendation
Monitoring and Followup

is required by “OMB Circular A-50.”) Is the plan
adequate? How will you resolve any inadequacy?
• Do you and the agency agree on the benefits of
implementing the recommendation? If not, have you
agreed to a basis for resolving the difference?
• If the agency has closed the recommendation in its
followup system, do you agree that doing so was
appropriate?
• Have you complied with all the followup
documentation and status reporting requirements in
your organization’s monitoring and followup system?
• Have you taken all the monitoring and followup
actions established by your followup plan?

Taking Additional Answers to the following questions should be
considered when a recommendation is rejected,
Steps When inadequately implemented, or inordinately deferred:

Necessary • In your opinion, is the recommendation still valid? If

it is, are agency reasons for not implementing the

recommendation reasonable?

• Were the recommendation’s objectives substantially

met by an alternative approach?

• Is there anything more you should do to get the

recommendation implemented? What?

• Should you close the present recommendation and

consider scheduling additional audit work at a later

date when you can better demonstrate adverse effects

or when timing will make its acceptance more likely?

• Is the recommendation a key one? Is it significant

enough to refer to a higher authority for action, e.g.,

inclusion in a 7-day letter (federal inspectors general),

to solicit outside intervention, or to get the

involvement of the audit organization’s top

management? What additional actions do you believe

are appropriate?

• Was there anything about the recommendation that

could have made it difficult to accept and implement?

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Appendix I
A Checklist for Recommendation
Monitoring and Followup

Is there anything that can be learned to make future
recommendations more readily acceptable?

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Appendix II

Case Study: GAO’S Monitoring and
Followup System

System Highlights • Monitoring and followup are done by staff members

responsible for, and knowledgeable about, the
recommendation. Under the direction of an Assistant
Comptroller General, staff members oversee the
effectiveness of the followup system. (See p. 34.)
• Each recommendation is followed up on an ongoing
basis—with at least semiannual updates. An
individual recommendation followup plan is
developed for each assignment. (See p. 34.)
• Results intended by each recommendation and the
benefits expected from its implementation are
defined as a basis for determining the adequacy of
implementation. (See p. 35.)
• GAO staff monitor action on recommendations using
agency reports to the Congress and information from
the GAO followup system. GAO staff do work on their
own to ensure that action was, in fact, taken. The
extent of the verification depends on the
recommendation’s significance. (See p. 36.)
• Recommendations are closed only for specifically
defined reasons. Implementation satisfactory to GAO
is the predominant reason. (See p. 36.)
• Accomplishments from recommendations are tracked
and identified by assignment and by individual staff
members. (See p. 37.)
• GAO’s ready access to the Congress and its
committees is used to achieve an additional measure
of influence when implementation of significant
recommendations is inadequate or inordinately
delayed. (See p. 37.)
• GAO Form 66, which documents followup actions, is
included beginning on page 39 and illustrative
material from the Comptroller General’s report to the
Congress on the status of open recommendations is
included beginning on page 43.

Overview GAO is a nonpartisan legislative branch agency which
assists the Congress, its committees, and Members in

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Appendix II
Case Study: GAO’S Monitoring and
Followup System

their legislative and oversight work. GAO makes
audits and evaluations of federal agencies,
contractors, and grantees at the request of
committees and Members. It also carries out auditing
activities assigned by the Congress under various
statutes. Through this work, GAO makes
recommendations for more efficient and effective
government operations.

GAO recommendations deal with complex problems,
and legislation is frequently required to implement
them. At any one time, GAO monitors and follows up
actions to implement over 2,000 recommendations.

Responsibilities Recommendation followup is an ongoing systematic
process. GAO staff actively (1) monitor
recommendations to ensure that they are promptly
implemented and (2) assess the effectiveness of the
corrective actions taken by the Congress or agencies
in response to GAO recommendations.

Monitoring and followup are done by staff members
responsible for the audit work. Each recommendation
must be followed up at least semiannually. More
frequent actions may be taken depending on such
factors as the recommendation’s significance and the
apparent reluctance to accept and implement it.
Additional actions to foster implementation of a
recommendation are documented in a
recommendation followup plan. This plan is strongly
recommended for all GAO assignments.

GAO’s Office of Policy is responsible for monitoring
the process, providing overall guidance and direction,
and preparing related management and status reports.

Implementation Although recommendation followup is an ongoing
Monitoring responsibility, all open recommendations are

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Appendix II
Case Study: GAO’S Monitoring and
Followup System

reviewed and information concerning them is updated
semiannually. This update is based on an
information/update report (GAO Form 66) prepared
by a centralized computer facility. Information on all
GAO communication products and recommendations
is entered in the computerized data base as they are
issued. An illustrative GAO Form 66 is included on
page 41.

In the spring and fall of each year, a GAO Form 66 for
each product having open recommendations is
prepared from the computerized data base and is
provided to the staff member responsible for
following it up. That form includes pertinent data
about the product and about each recommendation,
as follows:

• What the recommendation says.
• To whom it was directed.
• The results intended by the recommendation.
• The expected benefits of implementation.
• The most recent status of acceptance and

implementation.

Status information includes:

• The reasons for inaction if action has not been
initiated.

• What is being done and estimated completion dates if
action is in process.

• The action taken and the results achieved, compared
with those that were intended, if action is completed.

• A description of the shortfall and future action
planned if an alternative action was taken but was not
fully responsive.

• The reasons why the recommendation is no longer
valid if that is the case.

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Appendix II
Case Study: GAO’S Monitoring and
Followup System

Sources of Monitoring and followup information may come from
Update a variety of sources. 31 U.S.C. \ 720 and “OMB
Information Circular A-50” require agencies to report to certain
congressional committees and to OMB the actions
taken or planned on GAO recommendations. (App. V
describes those reporting requirements.) Each agency
has its own followup system. Many agency systems
are centralized and automated.

In agency reports to the Congress and OMB and from
agency followup systems. But before information
from any of these sources is accepted, GAO staff do
some work of their own. They need to ensure that
action was, in fact, taken and that implementation
produced the desired result. The extent of work that
GAO staff must do depends on the recommendation’s
significance. At a minimum, staff discuss the status of
the recommendation with agency program officials
and/or obtain copies of documents to show the
actions taken and the results achieved. For the most
significant recommendations, staff determine
additional strategies to promote effective
implementation.

Closing Trend analysis indicates that action on GAO’s
Recommendations recommendations usually occurs in the first 3 years.
After that time, few recommendations are
implemented. If a recommendation remains open
after 3 years, a special analysis is conducted to
determine whether implementation can be expected.
The analysis includes alternative strategies to get
action on the recommendation, including working
with congressional committees. The use of
GAO-provided questions and summary data at key
oversight, authorization, and appropriations hearings
frequently motivates agency action on
recommendations that were previously considered
unacceptable.

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Appendix II
Case Study: GAO’S Monitoring and
Followup System

GAO recommendations are closed only for one of the
following reasons:

• The recommendation was effectively implemented.
• An alternative action was taken that achieved the

intended results.
• Circumstances have so changed that the

recommendation is no longer valid.
• The recommendation was not implemented despite

the use of all feasible strategies. When a
recommendation is closed for this reason, a judgment
is made on whether the objectives are significant
enough to be pursued at a later date in another
assignment.

Reporting

Accomplishment When a recommendation achieves its intended
Reporting results, an accomplishment report is generally
prepared. That report provides an opportunity for
GAO and for responsible staff members to be
recognized for their part in an action and the benefits
resulting from it. The accomplishment report
documents both quantifiable and nonquantifiable
benefits that result from or were significantly
influenced by a GAO recommendation.

Reports to the Each year, GAO provides a report to the House and
Congress on Open Senate Appropriations Committees on the status of
GAO open recommendations. The report is intended for
Recommendations use by congressional oversight and authorization
committees, as well as the Appropriations
Committees, in preparing for hearings and budget
deliberations. The report

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Case Study: GAO’S Monitoring and
Followup System

• includes background and findings information on
each GAO product;

• describes the most recent actions on open
recommendations, including congressional actions;
and

• identifies the impact of GAO’s work in an area and
key open recommendations that, based on GAO’s
work and judgment, need priority attention from
congressional Members and staff as well as agency
officials.1

The preface to GAO’s January 1991 report on the
Status of Open Recommendations is included on
pages 43 and 44. Also, the report’s key
recommendations concerning financial institutions
and markets are included on pages 45 to 48.

1This information is sent separately to other interested
congressional committees.

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Followup System

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Followup System

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Followup System

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Followup System

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Case Study: GAO’S Monitoring and
Followup System

Preface to GAO’S This report provides information on the status of GAO
January 1991 recommendations which have not been fully
implemented. The report is intended to help

Report to the congressional and agency leaders determine the
Chair, House and actions necessary to implement the open
Senate recommendations so that desired improvements to
government operations can be achieved.

Committees on This year, significant changes have been made to
Appropriations, improve the report’s usefulness. The more important
on the Status of changes include the following.

Open The report is being issued earlier than in past years so
Recommendations• that sufficient time will be available for congressional

leaders to use the report in preparing for upcoming

appropriations and oversight activities.

• In the report, GAO products with open

recommendations are arranged by issue area within

budget function category, as indicated in the table of

contents. The addition of issue areas to this year’s

report is intended to make it easier for oversight

committees, federal departments and agencies, and

other interested parties to locate summary

information and key open recommendation highlights

within their areas of jurisdiction. For example, to

obtain information on defense issues, users of the

report would locate pertinent information by finding

the budget category entitled “National Defense.”

Within that category, seven relevant GAO issue areas

would be included that would highlight summary

information and report descriptions for various

defense matters.

• The report contains two indexes. The “Committees of

Jurisdiction” index can be used to identify GAO

findings and recommendations made to agencies for

which committees have appropriation and oversight

responsibility. The “Recommendation Addressee”

index can be used to identify the same information by

agencies to whom recommendations are addressed.

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Case Study: GAO’S Monitoring and
Followup System

• Each GAO product also includes the name and
telephone number of a GAO manager who can be
contacted for further information or assistance.

• The back cover of the report includes a “thumb
index” that identifies page numbers where budget
function categories and the two indexes are located
so that users of the report can easily find needed
information.

We believe the changes to this year’s report will
enhance its usefulness as a reference document. Any
information or questions not specifically related to a
prior product or recommendation should be referred
to GAO’s Office of Congressional Relations,
(202) 275-5739. Comments, questions, or suggestions
for improving the report can be directed to Anne
Hilleary, Office of Policy, (202) 275-1970.

Charles A. Bowsher
Comptroller General
of the United States

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Case Study: GAO’S Monitoring and
Followup System

Illustrative Key
Recommendations
in GAO’S January
1991 Report on
the Status of
Open
Recommendations

Issue Area Through our financial institutions and markets work,
Summary: Financial we identify defects in laws, regulations, and practices
Institutions and of banks, thrifts, securities firms, insurance
Markets companies, and other financial market participants.
Such defects, when left uncorrected, could lead to
Impact of GAO’s Work disruptions in the nation’s financial services or loss of
confidence by users. Our work to identify and correct
such defects has included work to report on the
financial condition of various segments of the
industry, such as banks, thrifts, insurance companies,
credit unions, and government-sponsored enterprises;
examine vulnerabilities of the financial services
systems, such as risks involved in automated systems;
report on the effectiveness of regulatory programs;
analyze the implications of federal policies that
prescribe the legal authorities for various segments of
the financial services industry; and understand the
implications of the increasing internationalization of
the industry.

Some of our recommendations are being
implemented to resolve the thrift crisis. In particular,

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